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Thursday, August 26, 2010

Retiree Ponzi Scheme Is $16 Trillion Short

Social Security just celebrated its 75th birthday. Love it or hate it, it has done its job and should retire. We need a new system, the Personal Security System, which retains Social Security’s best features, scraps the rest, and covers its costs.Social Security’s objective -- forcing people to save for retirement -- is legit. Otherwise millions of us would seek handouts in our old age.But Social Security has also played a central role in the massive, six-decade Ponzi scheme known as U.S. fiscal policy, which transfers ever-larger sums from the young to the old.In so doing, Uncle Sam has assured successive young contributors that they would have their turn, in retirement, to get back much more than they put in. But all chain letters end, and the U.S.’s is now collapsing.The letter’s last purchasers -- today’s and tomorrow’s youngsters -- face enormous increases in taxes and cuts in benefits. This fiscal child abuse, which will turn the American dream into a nightmare, is best summarized by the $202 trillion fiscal gap discussed in my last column.More Here..

Judge: Its Legal For Government To Track You In Your Car

The free world was aghast yesterday when the United States decided that it is perfectly acceptable for Government agents to sneak onto your property in the middle of the night, put a GPS device on the bottom of your car and keep track of everywhere you go.

The U.S. Court of Appeals for the Ninth Circuit has decided that this does not violate the Fourth Amendment.

8 comments:

Everything else I've read says that Social Security is solvent for another 20 years. And the simplest solution for making sure it says that way is to raise the cap. Right now people pay into social security on the first $107,000 they earn. If you raise the cap, or eliminate it entirely, then more money will be paid into the system.

I wonder if the people who cry wolf about social security are investment bankers? The Republicans (and now the Democrats) are trying to get their hands on SS and privatize it because Wall Street can make tons of money off of fees for "investing" the money. If SS was broke and had no money, do you think the effing politicians would try so hard to steal it?

I worked on a major pension plan several years ago. I don't know if Social Security works this way, but for that pension plan (a public one) the money collected was invested. It wasn't kept in place or even used to purchase bonds or some other type of interest generating system, it was invested in stocks and the like.

When the economy was booming this worked well and resulted in a surplus. When the economy stumbled---and this was a few years before the 2007 recession that investments began to fail--that money was gone and the pensions were then underfunded. The city was then required to fund into the system through taxpayer money, but there was a lot of litigation for it and I wound up leaving, and didn't bother following up on it.

But the current problems for Social Security are not limited to the young funding it---the problem is with Depression style employment hitting the younger generation the hardest, these younger people are also blocked off from gaining a good job in the first place.

The baby boomers are clinging to their well paid jobs that were ill gotten in a time where it was easy to get a job and everything paid so well. They're just passing jobs along each other since any decent job requires 10 years of exp, but since the entry level now requires similar exp the younger generation can't break in.

You are not going to be able to fund Social Security on a nation of sales associates and retail clerks. But apparently that is exactly what the older generations want to do. It's obvious that this system can't sustain itself.

There is no way it will last 20 years. The pension plan I worked on does exist still I'm sure, but if not for taxpayer infusions it would have failed virtually overnight. A successful pension has to have at least a 95% or something funding rate (why not 100% I do not know) but ours dropped below 80% on some estimate and around 70% on others. I am sure Social Security has dropped to around that now considering how deep this depression is compared to what was happening a few years ago.

That means cash influxes will be required to keep it afloat--on top of the regular payments people are making now into it. That is, taxpayers will either have to pick up more of the load or it fails.

Eventually you run out of that money--taxes are high enough already and government can never cut anything, but simply creates more things to spend on. Social Security will probably go at some point as a result, as I can't imagine a society that mortgages its younger generations for the older ones can survive long.

2:22 interesting, but putting pensions in a gambling casino (stock market) is hardly the right thing to do. Had they put it into GOLD like my father told me to do in 1979? Now you have a pension plan, like I do.

That was written in 1999. It is funny to see it now. I don't believe these projections because it has been shown these projections are always false, and the actual numbers are always lower. Expect 4 more years before it goes bankrupt.

This one will fail, no question. First was the subprime mortgages, then general foreclosures, then the banks and corporations (who were bailed out), then the student loan industry (another bail out coming?), then it's going to be something I'm missing now, and right after that it will be social security.

Well ,the system was a nice form of enforced 'volantary" taxation untill the Ponzi scheme end began to fall due and the on paper "savings",proved to be only fictional paper promises based on IOUs reserves that are fast losing real world value as claims to a share of future wealth. eat your food stamps debt peons!

2:22 interesting, but putting pensions in a gambling casino (stock market) is hardly the right thing to do. Had they put it into GOLD like my father told me to do in 1979? Now you have a pension plan, like I do.

Stock market or in property most investments are brinks and mortar or otherwise property related investments E.G banks investing in cormercial property or even in uour own home All this is related to the individual investor collecting from the rise in property values for individual benifit a claim of a tax on society in future generations .As for gold bugs its a good thing you livesd a while to see the gold price recover.

what was the price of gold in about 1979 ?After that didnt you feel like a dumb sucker for a few years when the gold price crashed? Good thing it wasnt just before your retirement!But. how long did it take to recover before your investment paid off in order to create your now comfortable retirement situation ?But now with gold stocks in hand you have an interest in getting others to buy gold to boost the value of your gold stocks ? True tho ,investment in shares didnt do ant better in the last decades .The Dow index is running about where it was at a decade ago.But what with devaluing of the dollar purchasing power thats not breaking even but a huge loss. Whats your 1979 gold value worth in non inflated real purchasing power dollar value in todays prices?

As in all Ponzi schemes, the early recipients of Social Security funds profit very handsomely, which renforces a false signal that current conditions can exist into perpetutiy. But in addition to the Social Security ponzi, that private, secretive foreign central bankster cabal called the Federal Reserve has been inflating the currency (legal counterfeiting) since 1913, and so todays dollar will not purchase tomorrow's bread; therefore, the dollars need to seek out anther ponzi scheme, The Wallstreet Bankster racket, to perserve and maintain the value of a Dollar.All Ponzi schemes collapse. After the American systemic collapse, the citizens will no longer be able to afford the luxery of "retirement." In general, the elderly will either need to reactivate themeselves into the market place, or hurry up and die. Likely the best of them will chose the former, and America will be a better place for it. Americans desperately need people who remember what it meant to be a producer, to be capable of declaring and winning a war, people who understand history and can remember the taste of real food grown on real farms by real farmers. Time to get busy. As one unretired elderly person told me: "It is better to wear out than to rust."